Asian Shares End Mixed After Chinese Data

4/2/2012 5:33 AM ET

Asian shares turned in a mixed performance on Monday, as manufacturing data from China offered a mixed snapshot of the nation's economy and investors adopted a cautious approach ahead of holidays this week.

An official survey of Chinese manufacturing released on Sunday showed manufacturing activity gained momentum in March, with the corresponding PMI rising 2.1 points to 53.1 in the month, up from February's 51.0 and January's 50.5, helping dispel lingering fears of a Chinese hard landing.

In contrast, the HSBC's flash manufacturing, the unofficial reading of China's PMI which tends to reflect trends in the export sector more strongly than the official index, showed manufacturing contracting and export orders falling.

South Korea's manufacturing PMI improved to 52.0 in March from 50.7 and Taiwan's manufacturing PMI improved to 54.7 from 52.7, while the expansion of India's factory sector slowed for the third month in March, separate surveys showed. The benchmark oil stayed largely unchanged near $103 a barrel, while the yen fell against the dollar and euro.

Japanese shares snapped a three-day losing streak, as the yen weakened against other major currencies and news that EU finance ministers agreed to increase the funds available for future bailouts bolstered sentiment. Stronger-than-forecast U.S. consumer sentiment data as well as Chinese manufacturing data helped lift export-related such as Fanuc Corp. and Hitachi Construction Machinery up 2-3 percent, while financials like Mitsubishi UFJ Financial Group jumped 3.4 percent on expectations for robust earnings.

The Nikkei Stock Average rose 0.3 percent, while the Topix index of all Tokyo Stock Exchange First Section issues ended up 0.2 percent. The Bank of Japan's quarterly "tankan" business survey released just before the market open, which showed no change in business sentiment among large manufacturers in the March quarter, raised expectations of further monetary easing by the Bank of Japan ahead of next week's policy meeting.

The Chinese market was shut for a three-day public holiday. Hong Kong's Hang Seng index shed 0.2 percent, extending declines for a fourth consecutive session, on speculation that policymakers will probably maintain lending curbs after a government report showed China's purchasing managers' index climbed to a one-year high of 53.1 in March, exceeding economists' estimates.

Australian shares eased slightly, as banks edged lower, offsetting gains in miners following improved Chinese manufacturing data. Both the benchmark S&P/ASX 200 and the broader All Ordinaries indexes erased their early gains to end down about 0.1 percent each. BHP Billiton, the world's largest mining company whose fortunes are tied to China's economic growth and consumer demand, rose 1.5 percent, Rio Tinto added 1.2 percent and smaller rival Fortescue rallied 2.4 percent.

Australia's manufacturing activity contracted in March, pressured by a stronger currency and weak domestic demand, a private survey showed. The Australian Industry Group/PriceWaterhouseCoopers Australian Performance of Manufacturing Index (PMI) fell 1.8 index points to 49.5 in the month after three months of growth.

Approvals for new homes, meanwhile, slumped a seasonally adjusted 7.8 per cent in February from the previous month, data released by the Australian Bureau of Statistics showed, marking the steepest fall in approvals since November last year.

Moody's Investors Service on Monday upgraded its outlook on South Korea's sovereign credit rating to "positive" from "stable," citing the country's improving fiscal fundamentals, better external financing conditions, a reduction in the banking sector's external vulnerability and a relatively strong gross domestic product growth trend over the medium term," the finance ministry said.

New Zealand shares fell, with the benchmark NZX-50 giving up initial gains to finish half a percent lower. Chorus, the network company spun off from Telecom in November, tumbled 2.4 percent from a record high, while shares of Telecom ended up a percent.